Tuesday, January 20, 2009

A Straight Shooter Talks Thin Film Solar

When I first came to the market a very successful investor told me he had three questions when looking at an investment:"What's the upside?""What's the downside?""What's the timeframe?"That kind of clear thinking helps you cut through the b.s.Here's another investor who gets to the point, via RenewableEnergyWorld:

Show Us the Money: Financing Thin-film PV Projects

A panel discussion at the Thin Film Solar Summit that took place in San Francisco earlier this month gave attendees a dose of reality: financing in the world of thin-film PV isn't a short-term play.

The reality, according to Neal Dikeman, partner with VC firm Jane Capital Partners, is that only one or two thin-film projects have brought product to market in 30 years, and it's a US $100M-$200M dollar up-front investment "just to play the game and see if your product really works."

Silicon Valley investors have mistakenly bet on "really great teams" while the technology is still at a science experiment stage, he argues — investors are beginning to realize this, he thinks, and that the industry is sitting on the back end of about 5-10 years of US $100M bets. "We're going to see a bunch of write-offs coming up," he warns....

...Lest he dash the hopes of conference attendees, Dikeman acknowledged that while thin-film PV technology has to come down the cost curve, it is the only hope for making solar more than a niche subsidized business. "We have to deliver US $1/Watt at the module level, not the cell level, in order for anyone downstream to have a serious business," he urged. "Otherwise, we'll be living off the investment tax credits and rebates over the next few years."

But don't hold out hope for a disruptive technology to solve the cost-curve challenge. "There is no disruptive technology in energy, only disruptive policies that make certain technologies look disruptive after the fact," Dikeman told the audience...MORE